Jakarta LRT starts operation, property industry flourishes

This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.

Investor Daily:  LRT Jakarta mulai beroperasi, industri properti bersemi

17 December 2019

Jakarta – Jakarta residents has received an alternative public transportation mode after the Velodrome-Kelapa Gading route of Jakarta Light Rail Transit (LRT) is commercially operational on Sunday (1/12), following the operation of Jakarta Mass Rapid Transit (MRT) from April 2019.

Jakarta LRT that spans 5.8 kilometres has six stations, namely Velodrome, Equastrian, Pulomas, South Boulevard, North Boulevard, and Pegangsaan Dua. Jakarta LRT is commercially operational after three test runs in August 2018, March 2019, and June 2019. Jakarta LRT has a fixed tariff for a trip, which is Rp5,000, following Governor Regulation Number 34 of 2019 on Railroad Transport Rates of Mass Rapid Transit and Light Rail Transit.

Rumah.com Country Manager Marine Novita explained that the urban mass transportation increased the price of properties. A new transportation corridor or a change on a mass transportation system will increase the potential for investment in property in that region.

“Operation of the Velodrom-Kelapa Gading route of Jakarta LRT will boost the price of property as it increases connectivity, public access, and shorten travel time. Even though the route is only 5.8 kilometres, Jakarta LRT will boost investment in properties in Rawamangun, Pulomas, and Kelapa Gading,” he explained in his written statement on Sunday (16/12).

Moreover, according to Rumah.com Property Index, property market in Jakarta is showing improvement after being stagnant last year. Rumah.com Property Index recorded that Jakarta property price index was at 131.0 index points, or a decrease of 0.07% (q-o-q) in the third quarter of 2019.

Rumah.com Property Index data has a high accuracy to identify the dynamic that is occurring in Indonesian property market. It is an analysis of 400,000 properties being sold or rented throughout Indonesia. It has more than 17 million pages that are visited every month and accessed by more than 5.5 property seekers every month.

“According to Rumah.com Property Index, the increase is above the average increase between quarters in 2018, which is only 0.2%. Jakarta residential property price increase is 4% yearly. The yearly increase is still the same as last year,” Marine revealed.

The hike in Jakarta property prices, especially in the third quarter of 2019, is caused by public transportation infrastructure development. After MRT is officially operational in April 2019, a test run for the Velodrome-Kelapa Gading route of LRT Jakarta is carried out in June 2019 at Kelapa Gading in North Jakarta and Pulomas as well as Rawamangun in East Jakarta. Since then, Jakarta LRT is now commercially operational.

A relatively stable property index in Jakarta in the third quarter of 2019 is boosted by the increase of property prices in South Jakarta, East Jakarta, and Central Jakarta.
 

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